Steel Mills
Hot Rolled vs. Prime Scrap Price Spread Holds Steady
January 22, 2023
The spread between hot-rolled coil (HRC) and prime scrap prices has remained relatively flat vs December levels, according to Steel Market Update data.
Prices for both products rose in January vs. the end of 2022.
Our hot-rolled coil price average ticked up $5 per ton week over week to $740 per net ton ($37.00 per cwt) as of Jan. 17, continuing an upward trend that began in late November.
January scrap prices settled higher earlier this month. Busheling prices averaged $440 per gross ton, up $60 per gross ton compared with December. Figure 1 shows price histories for each product.
After converting scrap prices to dollars per net ton for an equal comparison, the differential between HRC and busheling scrap prices is $347 per net ton through Jan. 17, when we last updated sheet prices. (We will update them again on Jan. 24.) In the previous week we saw a spread of $342 per net ton (Figure 2). At the end of December, the spread was at $346 per net ton.
PSA: Did you know our Interactive Pricing Tool has the capability to show steel and scrap prices in dollars per net ton, dollars per metric ton, and dollars per gross ton?
In Figure 3 we have graphed the spread between HRC and busheling scrap prices as a percentage premium over scrap prices. HRC prices now carry a 68% premium over prime scrap, little changed from 67% earlier this month but well below 80% at the end of December.
This comparison was inspired by reader suggestions. If you would like to chime in with topics you want us to explore, reach out to our team at News@SteelMarketUpdate.com.
By Ethan Bernard, Ethan@SteelMarketUpdate.com
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